Perspectives

Markets, with the exception of the Dow Jones Industrial Average, were roughly flat last week; the Dow rose 1.2% on strong earnings results from Boeing, Caterpillar, and Verizon.The Energy sector outperformed as oil prices continued to rally; Brent crude, the international benchmark, gained 9% this week to close above $50 per barrel for the first time since early June. The increase was driven, in part, by Saudi Arabia’s comments on Monday of its plan to further reduce oil exports in order to bo… View More

The Federal Reserve made no changes to interest rates today and made almost no changes to the text of its statement. However, the wording changes it did make strongly support our view the Fed will announce the start of balance sheet reductions at the end of its next meeting on September 20. First, the Fed qualified its reference to maintaining its current policy of rolling over principal payments by saying this was the policy only for the "time being." Second, at the last meeting in June, the … View More

One of the oldest adages on Wall Street is that investors are always worried about something. This summer, the markets are looking supportive of that old rule: When investors can’t find anything worth worrying about, they worry about why no one seems to be worrying enough. “The global market’s ongoing low volatility should be unsettling for investors,” portfolio manager Brian Singer of William Blair & Co. wrote earlier this month, and just about every client I’ve spoken to in the … View More

Markets rose last week with the launch of the second quarter earnings season. Technology stocks led the way with the popular “FAANG” group of companies regaining momentum. Energy stocks also rallied as oil prices continued to recover; West Texas Intermediate crude, the North American benchmark, has gained nearly 10% since hitting a low of $42.53 three weeks ago. Also, this week’s decline in crude oil inventories, which fell by the largest amount since September 2016, supported the price re… View More

Markets were mixed during the holiday-shortened week; the Financials sector outperformed as investors responded to rising bond yields. Energy stocks, though, remained volatile. Crude oil prices declined even as inventories in the U.S. fell to the lowest levels since January; continuing production increases in the U.S. and overseas are reportedly prompting OPEC to consider imposing production caps on previously-exempted Nigeria and Libya. Central banks were in focus as policymakers acknowledge im… View More

This year has been another good year for the S&P, with a year-to-date total return of 9.9% (as of 6/28/17). Investors are asking, “How have I done versus the index?” thinking predominantly of return and not risk. Very few investors are asking, “How am I protected against the next recession.” The memory of 2008, or 2000 to 2002, or 1973 to 1974, etc. is fading. A recent survey conducted by GoBankingRates found 68% of respondents said their portfolio strategy “DOES NOT ACCOUNT FOR TH… View More

Markets were mixed last week as the Financials sector rallied while Technology lagged. On Wednesday, several banks announced dividend increases and share buybacks; the decisions followed the Federal Reserve’s determination that, for the first time in seven years, all of the banks subject to its Comprehensive Capital Analysis and Review (CCAR), the so-called “stress test,” had passed. Higher yields on Treasury bonds further supported the favorable outlook for financial companies. The techno… View More